Estate Planning for the Wealthy
Estate Planning for the Wealthy
When was the last time you looked at your estate plan? If you can’t answer that question, either because it’s been so long that you can’t remember or because you still don’t have an estate plan in place, then you have some work to do. With the New Year almost here, now is a great time to take a closer look at your estate plan, or to start one, if you haven’t already. Estate planning is important for everyone, especially if you have a lot of wealth and you want to control what happens to it after you pass on. To that end, let’s take a look at some of the important tips to keep in mind for your estate plan.
Estate Tax Could Be Eliminated
Before we get started, there is one important factor to be aware of regarding estate planning and taxes. Now that Donald Trump has been elected president, there could be some changes coming to the estate tax laws: namely, he wants to eliminate the estate tax completely. Currently, any assets that exceed $5.45 million are taxed at a 40 percent rate for one’s beneficiaries. That money would be tax-free if Trump’s proposal is passed.
Remember Your Will
One of the first steps you should take is to draw up a will. That seems like a no- brainer, but the fact is nearly 70 percent of all adults in America as of November of last year did not have a will. Without a will, your estate will end up being divided in probate court and likely won’t end up where you intended.
What About Beneficiaries?
Of course, you get to choose who inherits your money, so make sure you choose wisely and specify which assets go to whom. It’s always a good idea to reevaluate your plan whenever a major life change occurs, such as a new child, a divorce or marriage or a death in the family.
Trust the Trust
Setting up a trust is always a good idea if you have a large estate. Having a trust, with a trustee, allows you to determine how your assets are used and protect them from being abused or misused after you’re gone. There are several types of trusts, but permanent or irrevocable trusts usually provide the most tax benefits. However, when you place assets in such a trust they become the property of the trust, which means they are not subject to estate taxes.
Consider a Roth IRA
Another smart move for many people is to convert a traditional IRA to a Roth IRA. The money from a traditional IRA is taxable if it’s transferred to anyone other than your spouse. However, you can avoid this by slowly converting traditional IRA accounts to Roth IRA accounts.
Give it Away Before You’re Gone
One of the best ways to protect your money and other assets is to give it away before you pass away. You can give away up to $14,000 per person in gifts every year. Those gifts will decrease the value of your estate and they are tax-free for the recipients. You can also donate your assets to charitable causes, which also provides a nice tax break. For more estate planning ideas to protect your wealth contact GROCO for help.
How the Wealthy Use Their Charitable Foundations for Good
How the Wealthy Use Their Charitable Foundations for Good What do Bill Gates, Mark Zuckerberg, Paul Allen, Gordon Moore, and Michael Bloomberg have in common? Of course, they are all among the world’s wealthiest individuals, but these men also have something else in common. They’re all on the list of the world’s most generous people.…
Could This Become the World’s Most Expensive Car?
Could This Become the World’s Most Expensive Car? World’s Most Expensive Car Got your eyes on a sweet, new ride this year? The luxury car market is a hot market to be in so it’s a good place to put your money if you’re interested in a new set of wheels. You have plenty of…
Should You Buy a Private Island?
Should You Buy a Private Island? From private yachts to private hotels and from private jets to private concerts, the world’s richest people can afford and enjoy some of life’s most luxurious splurges. So what buy private island? Have you ever considered owning your own piece of heaven? The private island market is not a…
Tech ETFs Were a Hot Commodity in January Trading
Tech ETFs Were a Hot Commodity in January Trading No matter what happens in the stock market, it seems that technology always plays a huge role in investing. Tech stocks are often some of the most popular stocks available and many fortunes have been earned and/or lost through investments in technology. In fact, recently, it…